London-based Fiat Chrysler Automobiles (FCAU, Financial), the seventh-largest automaker in the world, announced Friday that it would recall more than 1 million vehicles because they can roll abruptly and, as a result, cause damage and/or injuries if the transmission is being used incorrectly.
The recall was issued after a reported 41 injuries were connected to problems with the automatic gearshifts. The gearshift indicator has been redesigned for all models.
The recalls will affect nearly 900,000 cars and SUVs in North America. Another 250,000 vehicles in international markets will be recalled as well. The recalls involve vehicles made between 2012 and 2015.
Fiat Chrysler operates through two subsidiaries, FCA Italy and FCA U.S., and deals in many well-known automotive names including Alfa Romeo, Chrysler, Dodge, Fiat, Jeep, Lancia, Ram trucks, Abarth, Mopar and SRT; specific models affected by the recall are 2012-2014 Dodge Charger and Chrysler 300 sedans and 2014-2015 Jeep Grand Cherokee SUVs.
Fiat merged with Chrysler in 2009 after Chrysler filed for Chapter 11 bankruptcy reorganization. Chrysler came out of bankruptcy proceedings less than two months later with the United Auto Workers pension fund, Fiat and the U.S. and Canadian governments as its principal owners. Fiat gradually acquired shares from the other owners, eventually taking majority ownership and completing the acquisition in January 2014 for a total cost of $4.9 billion with an additional $5.5 billion pension liability.
Bill Nygren (Trades, Portfolio) is Fiat Chrysler’s leading shareholder among the gurus with a stake of 16 million shares. The stake is 0.94% of Fiat Chrysler’s outstanding shares and 1% of Nygren’s total assets. Mohnish Pabrai (Trades, Portfolio) is Fiat Chrysler’s second-leading shareholder among the gurus with a stake of 13,787,920 shares. The stake is 0.81% of Fiat Chrysler’s outstanding shares and 38.53% of Pabrai’s total assets.
Fiat Chrysler has a P/E of 33.4, a forward P/E of 5.1, a P/B of 0.8 and a P/S of 0.1. GuruFocus gives Fiat Chrysler a Financial Strength rating of 6/10 and a Profitability and Growth rating of 5/10.
Fiat Chrysler sold for $8.01 per share Friday, nearly 34% higher than its selling price of $5.99 per share on Feb. 9.
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